Matthew C. Mahutga’s interests include globalization and international trade, to income inequality in developed and transition economies, to changing patterns of economic organization world-wide, and to economic development in poor countries. He has delivered lectures on these and related topics to national and international audiences, and is the author of dozens of related academic articles. In 2016, he was awarded the 2016 Distinguished Article Award from the American Sociological Association’s section on Political Economy of the World-System for his work on the developmental implications of globalized production networks. He is also principal investigator of the 2015-2017 National Science Foundation grant on the Distributional Consequences of Economic Globalization.
On Globalization and International Trade
Globalization has been widely regarded as a great leveler of human society, insofar as it has led to the diffusion of manufacturing to some of the poorest regions of the world. Yet, some of my work finds that international trade creates a structure that is exceedingly hierarchical. While globalization has led to some changes, I’ve observed a degree of inertia that is inconsistent with the narrative of globalization as the great leveler. Developed countries still have the most geographically and economically diverse trading profiles, they export technologically sophisticated goods to less developed countries in exchange for less technologically sophisticated goods, and inculcate asymmetrical trade ties with weaker partners. Moreover, these patterns of international trade can be increasingly explained by the economic behavior of multinational firms, who build geographically diverse production networks through both foreign direct investment and non-equity based subcontracting relationships. As the coordinators of these far-flung production networks, leading multinational firms make incredibly important decisions about the types of activities that migrate to less developed countries, and the terms under which these countries can participate in globalized production.
On Economic Development
I investigate wages and productivity in three industries (autos, electronics and garments) known for ideal-typical models of network governance. The project is motivated by two guiding hypothesis. First, because leading firms construct production networks to maximize their own returns, the gains from network participation should vary across network positions. Second, because certain forms of network governance are less asymmetrical than others, the differentials between lead and subordinate positions should vary by network governance. In a small pilot study, I find that workers in countries with subordinate transport-equipment suppliers gain in an absolute sense from their incorporation into global production networks, but these gains are smaller than that accrued by workers in countries with leading firms. In the garment industry, I find that workers in countries with subordinate suppliers lose from their incorporation into global production networks, both relative to workers in countries with leading firms and in an absolute sense. That is, workers in countries with leading firms achieve greater wage gains from their effort than do workers in countries with subordinate firms in all industries, but the extent of this inequality varies across industries.
On Income Inequality
Social-scientists began writing on the possible socio-economic effects of the globalization of production on workers in rich democracies as early as the 1980s. Early writers described globalization as the great “hollowing out,” where (generally well-paying) manufacturing jobs were taken off-shore and replaced with (generally low-paying) service sector jobs. During the same period, deindustrialization became a fairly ubiquitous trend in rich democracies, whereas other purported effects of globalization — rising inequality, declining unionization, welfare state retrenchment, etc. — were more varied. In the 1990s and early 2000s, however, social scientists were more skeptical about globalization. Empirical work during this period was exceedingly mixed — globalization was found to have strong, weak and even null effects on deindustrialization, income inequality, unionization and the welfare state. My work contributes to this debate by implicating both a firm-centered theory of globalization and cross-national variation in egalitarian institutions as moderators of the link from globalization to socio-economic change.